Problem Statement

To keep its liquor license, Kroger must comply with Florida regulations requiring high-proof spirits to be segregated from other goods at FC03 (Groveland) within 90 days.

The state outlined the following requirements for continued alcohol sales:

Dedicated Payment Channel: Remote orders for spirits must use a payment channel exclusively for permitted merchandise.
On-Site Payment Processing: Payments must be processed only at the licensed alcohol facility.
Separate Receipts: Transactions for spirits must appear on a receipt only for permitted items—no mixing with other products.

These changes require updates to order splitting, inventory management, payment systems, and fulfillment workflows to avoid license loss and service disruption.

Separate Alcohol Facility Impact

To meet these compliance requirements, high-proof spirits must be stocked and picked from a physically separate, licensed alcohol facility within or adjacent to the fulfillment center. This separation directly affects the picking, packing, and staging process.

Orders containing both grocery items and spirits now follow two distinct paths:

Grocery items are picked through the robotic fulfillment system.
Spirits are picked manually from the separate alcohol facility.

These paths converge at a merge station, where both segments of the order are combined, scanned, and reconciled before staging for final delivery. This ensures customers receive a single, complete order.

While this process maintains a seamless customer experience, it also introduces added complexity. Coordination between systems, accurate inventory tracking, and strict reconciliation procedures are now critical to prevent delays, misplacements, or compliance risks.

Discovery Sessions

From July through September, we held a series of discovery sessions and collaborative workshops with business owners, internal stakeholders across Kroger, and our 3rd party partner. These sessions helped surface key constraints, clarify regulatory interpretations, and align on the operational realities of both systems. The outcomes included detailed notes and a shared understanding of how to solve for compliance while working within the technical and contractual limitations of our 3rd party partner’s platform.

The Picture Begins to Form

From the totality of our meetings, we developed a clear understanding of the required steps. A site visit to the fulfillment center deepened our knowledge and helped us begin piecing together how the end-to-end process would need to function. This visit also raised important questions with Kroger business partners—most notably, whether the co-located manual-pick alcohol facility should be treated as part of the primary robotic fulfillment center or as a separate site within Kroger’s systems.

Landing on a 2-site Solution

Over several sessions, we evaluated and debated the merits of a single-site versus dual-site approach. We carefully cataloged the arguments for each option, weighing technical feasibility, compliance concerns, and downstream impacts. Ultimately, we aligned on a two-site solution. While neither option was perfect, this path best met the business requirements and supported the needs of finance and accounting for tracking, reporting, and reconciliation.

End-to-End Mapping

Once we finalized the decision to move forward with a two-site process, we shifted focus to understanding the detailed picking workflows—both within the primary robotic fulfillment center and the manual alcohol fulfillment area. This helped clarify how items would be selected, merged, and staged for delivery under the new model.

Mapping Workshops

We met with a primary stakeholder to walk through the dual pick-path journey—mapping where the robotic and manual fulfillment paths diverge and converge. During this process, we identified the required inputs for each phase and the expected outputs that would drive the next step. We also documented edge cases and defined what success and failure would look like at each stage of the workflow.

Delivering the Service Bluperint

We ultimately delivered a comprehensive service blueprint that outlined the end-to-end order lifecycle—from customer order placement through fulfillment, merge, delivery, and exception handling. The blueprint illustrated the diverging and converging pick paths between the robotic fulfillment center and the manual alcohol facility. It detailed system inputs and outputs for each phase, highlighted decision points, and mapped out both standard and edge-case scenarios. This visual artifact aligned cross-functional teams around a shared understanding of process flow, dependencies, and compliance checkpoints, serving as a foundational reference for design, engineering, and operations teams.